Taiwan marching towards record installation of 20GW solar PV by 2025

Taiwan, which joined the gigawatt (GW) solar photovoltaic (PV) market club in 2019, is set to ramp up its solar PV deployment, exceeding 2GW annually in the next few years to march towards the goal of 20GW in 2025, says GlobalData, a leading data and analytics company.

The country installed 1.6GW of new solar PV capacity to end 2019 at cumulative solar PV generation capacity of 4.3GW. In addition, Taiwan is estimated to add record 2.25GW of new solar PV deployment in 2020.

In September 2019, Taiwan announced a new solar plan for 2019-2020 to bring new investment and business opportunities of approximately TWD$222bn (US$7.5bn). The plan aims for the solar capacity to reach 6.5GW by the end of 2020. In mid-term, the government aims for PV installation to reach 20GW in 2025 with the contribution of 3GW from rooftop PV and 17GW from ground-mounted systems.

To support these ambitious goals and attract developers and investors, Taiwan is encouraging feed-in-tariff (FIT) policy and tariff rates. Though the government recently revised FITs with a minor cut for solar, which are applicable from the start of 2020, rates are still attractive to drive downstream PV market. The revised FITs for solar PV are TWD$3.9408-5.7788 per KWh (US$0.13-0.19).

Taiwanese regulations restrict solar developers from buying modules made in China to protect local manufacturers. In addition, local modules that have voluntary product certification (VPC) provides developers with a 6% bonus to their FITs.

The VPC is awarded to locally made high-efficiency cells and modules through a testing regime. The incentive not only protects local module suppliers but boosts indigenous cell and module manufacturing.

Module overcapacity in China has continued to put pressure on PV pricing worldwide over the last few years. Taiwanese cell manufacturers had restructured their businesses in the past by turning into module manufacturers to sustain China’s pricing war. The industry is currently further diversifying and moving more downstream by re-modelling their business offerings on project development and engineering, procurement and construction (EPC) work.

Transition and focus towards ground-mounted systems will be required to drive the GW scale market that will face the challenge of land acquisition in the island country. The government needs to effectively collaborate with developers, communities and landowners to overcome the hurdle.